The global rating agencies S&P and Moody's have downgraded the credit ratings for several government-related entities in Dubai on fears about the government's failure to provide timely financial support to them.
But says govt finances the weakest aspect of the country's macroeconomic profile.
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The rupee had slumped to a record low of 59.9850 rupee to the dollar on Thursday, as the country's record high current account deficit is exacerbating its vulnerability in an emerging market rout.
Responding to what is widely felt by the political establishment in Europe to be the "destabilising" role played by credit ratings agencies in the ongoing euro zone crisis, the European Commission unveiled measures to curb their power.
The global ratings agency keeps India's sovereign rating unchanged at 'BBB-' with stable outlook
On Tuesday, Economic Affairs Secretary Arvind Mayaram told reporters that economic growth this financial year would be over five per cent and the numbers in the second quarter would be better than the first quarter which yielded gross domestic product expansion of 4.4 per cent, a four-year low.
The ministry sought to allay the rating agency's concerns and said economic growth was on an upward swing.
Amid rupee sliding below 64 to a dollar, global agency Standard & Poor's on Tuesday said it will maintain negative outlook for the country as currency depreciation is adversely impacting investor confidence.
Gandhi also attacked Prime Minister Narendra Modi over the economic situation in the country, saying the PM should get his head "out of the sand" to deal with the problem facing the country.
Government hits back, tells rating agency to introspect on processes.
'The slide in growth has arisen primarily because we have an NBFC crisis on top of a banking crisis,' points out T T Ram Mohan.
There are various estimates of India's debt to GDP ratio, but the consensus is that that it would be over 80 per cent at the end of the current fiscal year.
'The good news is that money continues to flow into India-focussed offshore funds.'
Growth forecast has been lowered owing to tepid growth in the first half of 2017-18, the lingering effects of demonetisation, transitory challenges of GST, and some risks to agriculture stemming from a spotty monsoon.
'This is clearly a much stronger government, a much strong Prime Minister's Office and a much more disciplined approach. There is an improvement of the work culture in the government -- people don't play golf in the mornings anymore. There is a huge attempt going on to making business easier,' says Rakesh Mohan, executive director at the IMF.
India welcomed resolution of the political crisis in Sri Lanka and exuded confidence that relations between the two countries will continue to move on in an upward trajectory.
The index had risen over 585 points in the previous three sessions.
